ACCA Applied Knowledge · Financial Accounting · Trial balance
A trial balance balanced. Later, three errors were found: (1) a $400 credit sale was omitted entirely; (2) a $600 payment of insurance was debited to the rent account; (3) a $250 cash purchase of equipment was debited to the purchases account. How many of these errors would have caused the trial balance to be out of balance?
None of the errors would unbalance the trial balance. An omission, a wrong account of the same type and a wrong class of account all keep debits equal to credits, so the trial balance still agrees.
- ANone of themCorrect
- BOne of them
- CTwo of them
- DThree of them
Explanation
An omitted transaction leaves both sides unaffected. Insurance debited to rent is an error of commission, with both entries still of equal amount. Equipment debited to purchases is an error of principle, again with equal debits and credits. So the trial balance balances despite all three.
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